Media and utility giant Vivendi has said that it will sell subsidiaries worth 12bn euros in a struggle to regain prosperity. At the same time, the company announced a mass resignation of directors.

But the firm reversed an earlier announcement that it had sold an Italian pay-TV subsidiary for 1bn euros (£627m; $978m), although it said it hoped to complete the sale soon.

Jean-Marie Messier: No severance pay

Offers for editing division Vivendi Universal Publishing, and telecoms business Cegetel, were being studied in a drive by debt-laden Vivendi to raise cash.

"The reduction of the company's debt has started through a major asset disposal plan... with the target of achieving at least 12bn euros over 18 months," said chairman Jean-Rene Fourtou.

"We are leaving the crisis behind us.

"The main sources of loss have been reduced, sold or halted, or are about to be."

Messier snub

But Mr Fourtou failed to clarify the future of Vivendi Environnement, the utility arm which formed the company's core unit until its lurch under the leadership of Jean-Marie Messier into the media and entertainment businesses.

Getting out of Telepiu was essential to stopping losses from our treasury

Jean-Pierre Fourtou, Vivendi Universal

Mr Messier was ousted in July after an 80% decline in the company's share price, a fall largely blamed on its focus on out-of-favour sectors.

Vivendi was determined not to offer Mr Messier a severance package, financial director Jacques Espinasse said on Wednesday.

"Mr Messier is not being paid by the company," Mr Espinasse
said.

The six board directors who resigned on Wednesday, and who included Alcatel chairman Serge Tchuruk, were considered largely to be Messier sympathisers.

Telecoms deal

Vivendi said it was very close to selling its Italian TV business, Telepiu, to Rupert Murdoch's News Corp in a move which would cut debt by 220m euros.

News Corp's share skipped up 3.2% on Thursday morning in Sydney on news of the potential deal, which would make Mr Murdoch the dominant player in Italy's pay-TV market.

Vivendi also confirmed receipt of "acquisition proposals" for VUP.

And it said it was considering "every possible solution" on Cegetel, in which it owns a 44% stake, with BT, Vodafone and SBC.

A decision is expected by the end of the year over whether it will sell its holding, with Vodafone seen as the most likely buyer, or invest more cash in the business.

Sale targets

While Vivendi had been widely tipped to reveal a reduction in its 41% interest in Vivendi Environnement, Mr Fourtou pledged no sale for at least 18 months.